Even I didn't think that this was the most likely scenario, but it appears to be happening now. Click the following link and see how it has played out so far! Even the date of the top of wave B is likely to be the same as displayed in the chart. Magic?!
BIG UP from October to end of December
BIG BIG DROP from end of December to March
ndau
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Thanks everyone. I was just trying to replicate the drop in the Chinese market. I was speculating what would happen if (1) wave B in the US market retraced the same proportion as it did in the Chinese market after the epidemic and (2) wave C in the US market also followed the same fib extension as the wave C of the Chinese market. Given that most of the trading is done by algorithms, I thought that they might respond in the same way to a major event.
Even I didn't think at that time that S&P500 could retrace that much but the level appears to be achievable now. This scenario could become even more realistic if the rate of Covid-19 cases/deaths increased dramatically after the economy is opened.
Just curious about what makes it more realistic now? Not bashing, I just don't understand...
Trendymanners
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@isabellaalexandra, If you are familiar with Elliott Wave you will recognise that ABC is the last 3 waves of the 8 wave pattern. We ae currently at the resistance levels set by September 18 and April 19, which are also 61.2% Fib retracement. Ndau has drawn bigger retracement that not only breaks the resistance at 3025 but goes beyond to a point that I cant see anchored by anything . Maybe Ndau will let us know the reason for picking that point.
isabellaalexandra
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@Trendymanners, yes, familiar with EW. I guess he has B at 786 retrace but I don't know what C is based on. Was just wondering what makes this scenario more realistic now as opposed ot when it was originally posted.
DaddySawbucks
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@isabellaalexandra, Typically C=A but often goes to 1.272xA, or in severe panics may extend to 1.618 - 2x A
BIG BIG DROP from end of December to March